Key figures in massive stock manipulation scandal indicted
Published : 2013-02-19 15:45
Updated : 2013-02-19 15:45
Prosecutors said Tuesday they have brought charges against five people, including a former energy ambassador, for allegedly reaping massive profit from a stock manipulation scheme linked to a diamond mining project in Cameroon.
The suspects are accused of pocketing about 90 billion won ($83.24 million) by inflating the stock prices of South Korean mine developer CNK International, after exaggerating the volume of diamond reserves in a Cameroon mine developed by the KOSDAQ-listed company through a press release.
The statement, issued by Seoul's foreign ministry in December 2010, claimed the company won a project near the southeastern town of Yokadouma, Cameroon to mine about 420 million carats of diamonds, 2.5 times the annual global diamond production at that time, they said. The mine was later found to hold only 6 percent of the exaggerated amount of diamonds.
Following the announcement, shares of the KOSDAQ-listed company jumped from about 3,000 won to 16,100 won per share, more than fivefold, in about three weeks.
Kim Eun-seok, the former Energy and Resources Ambassador, is suspected of having used his influence as a senior official at the foreign ministry to order the overstated press release, prosecutors said.
The other four suspects in the scandal are former vice-chairman of CNK, a lawyer surnamed Yim and two accountants of the company, they said. (Yonhap News)